Weekly Market Report – 21 June 2026

A bit of a roller coaster ride on both markets this week, initially sparked off by the suggestion by some weather forecasters that there might be a frost in Southern Brazil next weekend.  However later updates revised this forecast suggesting that the temperatures would remain well above freezing.  Nevertheless, sentiment had changed and more bullish overtones dominated both markets for the rest of week with both ending the week higher.   Over the week arabica coffee prices gained 14.40 cents/lb, with the second position (September) closing at 267.80 cents/lb.  Robusta gains were more modest with prices gaining $67/ton (3.05 cents/lb) to finish the week at $3,592/ton (September).  In the absence of local market distortions, roadside parchment coffee prices in Papua New Guinea next week will probably between 145 and 150 toea/kg higher than they were last week.

It is difficult to pinpoint what has happened to create such a turnaround in sentiment over the week, however, the volume of stocks certified against New York has been shrinking consistently for the past couple of months, reaching a 2 year low on Thursday of 394,267 bags.  ICE robusta inventories on the other hand, jumped to a two-year high on Thursday of 4,032 lots.  There are also serious concerns that persistent rain in Brazil will delay the current coffee harvest with heavy rainfall forecast across practically all of Brazil’s coffee-growing regions this week. Counteracting those concerns, however, is the fact that the same weather forecasters are also predicting there will be mostly dry weather the following week. Another factor which may be playing a part in this turnaround is the realisation that the super El Niño weather pattern being predicted may delay rains during the crucial flowering period in Brazil during September and October and that this would almost certainly damage Brazil’s coffee crop next year. Colombians will be heading to the polls today for the presidential runoff between the far-right candidate Abelardo de la Espriella and the left-wing candidate Iván Cepeda. The opinion polls suggest that the right-wing candidate will win bringing about a significant shift away from the current President Pedro’s agricultural and security policies.

Once again, I cannot get access to any reliable regularly-published data on price differentials, so I have had to rely on sources which may not be entirely accurate or up to date.  Physical price differentials have hardened significantly this week, with Brazilian 3/4’s quoted at minus 14.  Likewise, Honduras HGs are up at plus 23, Kenya AB FAQ’s are much higher at between plus 55 and plus 60; Colombian UGQ’s are also much higher at plus 55. It therefore seems likely that PNG Y1’s will also be higher at possibly plus 10 but this is just a guess.  If this is still correct, then it should have been possible for an exporter to have fixed on Thursday (the arabica market was closed on Friday for an American public holiday) in New York for Sept/Oct delivery at a price somewhere between 282.70 cents/lb and 278.10 cents/lb.   The robusta market fell on Friday while New York was closed which does not bode well for the opening on Monday.  Furthermore, the latest Commitment of Traders reports shows that the managed funds are now net short overall.  Counteracting this is the fact that short term supply tightness as demonstrated by the drawdown in arabica certified stock remains a significant factor in driving market sentiment.  Even so, and despite the rosier picture that this week’s market activity suggests, the outlook unfortunately remains decidedly bearish, and I therefore expect prices to come under further downward pressure next week.    

Source:
Mick Wheeler, UK.

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